(Adds additional sources, background about the bank's
By Aruna Viswanatha, Karen Freifeld and Peter Rudegeair
April 24 The U.S. Department of Justice is
asking Bank of America Corp to pay more than $13 billion
to settle allegations the bank overstated the quality of
mortgage bonds it sold during the housing bubble, according to
Sources familiar with that matter told Reuters on Thursday
that discussions were in very early stages, and at least one
source said the $13 billion figure is not currently on the
negotiating table. CNBC News reported that Bank of America's
mortgage securities settlement could exceed $10 billion.
Any settlement with the Justice Department would be in
addition to the $9.5 billion accord it reached with the Federal
Housing Finance Agency to resolve similar litigation over
residential mortgage securities, according to Bloomberg News. A
possible agreement to resolve federal and state investigations
could come within the next two months, according to people
familiar with the matter cited by Bloomberg.
A Bank of America spokesman declined to comment. A
Department of Justice spokesman was not immediately available
The second-largest U.S. bank faces multiple government
probes over the underwriting, sale and securitization of
residential mortgage bonds before the financial crisis.
The bank said in an annual regulatory filing that the staff
of the New York Attorney General's office told Bank of America
they intended to file an action as a result of their inquiry
into its mortgage securities practices. A U.S. Attorney's office
advised Bank of America it would recommend the Justice
Department bring a civil case against its affiliates over
mortgage bonds, the bank said in its filing.
(Reporting by Aruna Viswanatha, Karen Freifeld and Peter
Rudegeair; Editing by Meredith Mazzilli and Lisa Shumaker)